I've seen plenty of local students in the undergraduate and postgraduate courses I've "known". The quality is low, low, low. All the local students that I have known care about is just getting the masters piece of paper, because it translates into a slightly higher job. Their English level (even though the degree has something to do with English) is not extraordinary and they couldn't have an intellectual conversation in English. It's an insult to the word "masters".
I don't know that many mainland Chinese students in postgraduate courses, but for the undergraduate courses, the mainland students have been very meticulous with their studies, hard-working, very out-spoken and involved in the lessons and produced the best work of the class. Granted, this is likely because these students have are living "abroad" and far away from home -- so stepping outside the box a bit in life and they're probably from well-to-do families. But if local people have a problem with so many students from mainland China, why don't they step up their own effort? If there is any issue of the quality of courses/universities sinking in Hong Kong, it's not simply because of the number of students from mainland -- it's probably because of the quality of local students!